Why Mediate – part 1 – What’s wrong with litigation?

The other side is obstinate and pigheaded, completely wrong, and refuses to see that you are right. You cannot stand the sight of the other person who makes you sick just thinking about him/her, let alone facing that other person. If you are both in the same room, then you’ll just at the best, get into a slanging match.

Better just to let the justice system take its route, and have a judge decide.

Well, I have news for you – the legal system nowadays forces you to engage in some form of mediation prior to hearing the case. Only in a few sorts of cases, mainly where the time and costs of a mediation is not proportionate to the amount of the money in dispute, will a court or tribunal not insist on mediation.

There is one practical reason and one social reason why the government and judges want mediated settlements rather than court imposed judgements in commercial and matrimonial disputes:-

The court’s resources (ie the taxpayer’s dollars) are saved – the government can spend the money on other things. Research around the world and in Victoria (including the seminal 2009 256 page report into Mediation in the Supreme and County Courts of Victoria) show that a huge majority (77- 85%) of cases referred to mediation settle. Time and resources can now be more effectively utilised

Mediation helps repair the social and inter-personal fabric that has been damaged and torn apart by conflict. Preserving social cohesiveness is one of the primary purposes of a democratic government. Both parties (taxpayers and their extended contacts – family and friends) ultimately are unhappy with court imposed orders – Justice is a very blunt instrument to solve a dispute. The judge will usually have to award 100% to one side, even if the other side has some valid reasons for acting the way it did. Thus there will be at least one side that will still be unsatisfied with the decision (leading to the distinct possibility of appeals – thereby incurring more costs and not allowing closure), and the other side will have lost out in unrecovered time, emotional costs, and non-recoverable legal fees.

The disadvantages of litigation are well known and documented:-

Financial Costs. The huge pre-trial and trial legal costs;

Time. The time it takes to get to trial – years in many instances;

Publicity. The lack of confidentiality, and its sidekick, publicity, during the trial and judgement;

The outcome. The decision is left to a third party, whom you may feel does not fully appreciate your position;

Rules of evidence. Rules of evidence may exclude or limit many things that you think are important;

Loss of control. You personally have little or no say in the process of getting to trial, which can be frustrating to a non-lawyer, or someone not used to the court system; and

Other costs to you. There are huge costs in time, emotions, non-recoverable legal costs and the inevitable diversion of your focus from other parts of your life/business

I will enumerate the advantages of mediation, also in point form, in the next post.